Creating a routine and diligent saving habit is not easy. It needs patience and is the ideal way to accumulate a substantial corpus for the future. But if you are looking to multiply your money quickly and maintain your investment habit, you can take a head start with a Recurring Deposit.

An RD is one of the best and low-risk investment tools. It also offers sizeable profits in as little as a year or even a few months. When you open this account, you are given a choice of investment amount, duration, and other benefits:

1. Best for planning short-term goals

RDs are entirely risk-free and provides assured profits. Given their nature, users who plan on achieving short-term objectives within one to three years opt to invest in them. They may release you from financial burdens, such as funding your wedding expenses, annual education fees for your children, renovation costs, higher education costs, and buying or upgrading your phone.

2. Invest with any amount

With a Recurring Deposit Account, even those with modest incomes can accumulate savings because the minimum balance starts at about Rs. 500 and fluctuates depending on banks. You can start with a budget that suits you without sacrificing daily costs. It comes with guaranteed returns. The Recurring Deposit interest rates are also locked in, protecting the individual against fluctuations.

3. Facility to open an account online

Investing becomes simpler when all well-known banks provide online RD services. The individual can update information, view deposit details, dismiss the RD, examine transactions, start another RD, make deposits, and do much more online.  Besides, it is simple and allows you to earn money without leaving home.

4. Interesting interest rates

Interest rates on RDs depend on the deposit size and tenure. These are comparable to Fixed Deposits. Essentially, the interest rates in RD Accounts differ based on the bank and the customer’s choice of plan. A lot of banks also give senior citizens higher interest rates. An ideal way to figure this out would be to use an RD calculator to check how much interest you may earn for a specific duration, interest rate, and deposit amount.

5. Possibility to save more through instalments

When people receive substantial amounts of money, like annual bonuses, most opt for an FD. However, if your salary and monthly spending habits leave you with less money towards the end of the month, you can set up an RD with the excess cash and earn decent interest, higher than Savings Accounts. Doing this can save modest amounts that add up to a considerable number over time.

Conclusion

RDs are an excellent strategy for developing a consistent saving and investing habit. You can make regular, small-amount investments without more significant risks and efficiently accomplish your short-term goals.